Real Estate Agent Salary: How Much Can You Earn?
The average salary for a real estate professional in the United States is about $23,000. They also make around $110,000 a year in commissions. Click To TweetIf you know your profession, you can make the latter or if you cannot make that much, you can still profit significantly and maintain a successful business. The reason why some agents can make more than others lies in the fact that the average agent is perceived as an independent contractor or as a self-employed professional. In other words, they are only paid what they make in a sale via commissions which are based on the sale price. This can amount to 4% - 6% of the total amount. In other words, if you do well as a real estate agent, you will be paid well so there really is no limit to how much you can earn. However, this requires hard work and dedication. If you want to make a 6 figure salary, you can’t rest on your laurels and expect a fat paycheck at the end of each month. The real estate industry is one of the very few industries in which hard work and merit determine how much you earn, and not office politics and/or promotions. This spells good news for those who cannot stand a 9 to 5 job, but it also means they have to work hard to sell property every week. No matter what your reason is for becoming a real estate agent, you have to understand that you may not make as much in the beginning. Just like a new job, you will have to create your client base first, and maintain working relationships with them that can see you through dry periods. In real estate, you will learn on the job even as you create a client base and establish your business. There is only so much learning and preparation you can do before you need to begin working. Once you have enough referrals from satisfied clients, you can grow into a successful business, and discover more ways to attract clients. On average, a real estate professional can make about $36,000, and top performers can make more than that. Naturally, part timers and agents who sell a house a month make way less than this. Even if they supplement that income with a fulltime job, managing both can be taxing. How much they end up making depends on the transactions they complete, the commissions they get from their brokerage, and the split they get from the broker sponsoring them. If they are good enough, entry level agents can make about 50% of the commission from successful sales. There is more money in sales because the commissions are larger compared to rentals. Rental agents can only take a month’s rent as their cut while a sales agent gets paid around 4 to 6% of the value of the sales price. For instance, in New York, a sales agent can make about $42,000 in sales in a month while the average rental agent in the United States can only make about $2,400. That is a significant pay gap!